Opinion
No. A06-1072.
Filed: June 19, 2007.
Appeal from the District Court, Hennepin County, File No. 27-FA-000249476.
Gail P. Bender, Minneapolis, MN, (pro se respondent).
Michael L. Perlman, Perlman Law Office, Minnetonka, MN, (for appellant).
This opinion will be unpublished and may not be cited except as provided by Minn. Stat. § 480A.08, subd. 3 (2006).
UNPUBLISHED OPINION
In this child support dispute, appellant-father challenges a district court order, arguing that the district court abused its discretion by declining to modify child support and by crediting respondent-mother's child-related expenditures, made pursuant to the initial child-support order, toward her total retroactive child support obligation. Because we conclude that the district court did not abuse its discretion, we affirm.
FACTS
Father Alan Bender and mother Gail Papermaster married in 1970 and divorced in 2002. They are parents of three adult children and now-18-year-old H.B. H.B. was 13 at the time of the dissolution trial. Mother is a self-employed oncologist. At the time of trial, the district court found her annual income to be $147,500. Husband is an epidemiologist who works for the State of Minnesota. Husband's gross annual income was $98,134 at the time of trial.
The parties chose not to litigate custody and entered into a parenting plan under Minn. Stat. § 518.1705 (2000). The plan did not formally label the custody arrangement. And although the district court's order described the parties as having joint legal and physical custody of H.B, the district court did not apply the Hortis/ Valento formula when it calculated child support. Instead, because the district court found that the parties spent nearly the same amount of time with H.B., it concluded that the ordering of child support pursuant to Hortis/ Valento was not proper. The district court reserved child support and, with limited exceptions, ordered each party to pay for H.B.'s expenses when H.B. was in that party's care. The exceptions were that mother was ordered to pay for H.B.'s clothing and father to pay for extracurricular activities.
Father appealed the district court's order on several grounds. Bender v. Bender, 671 N.W.2d 602 (Minn.App. 2003). This court concluded that the district court erred by failing to apply the Hortis/ Valento child support formula and that the district court's findings did not support a deviation from the presumptive child support guidelines. Id. at 608. We reversed and remanded for recalculation of child support under the Hortis/ Valento formula. Id.
On remand, the district court recalculated child support based on Hortis/ Valento. The parties stipulated that mother's net monthly income for purposes of support calculation in 2001 was equal to or greater than the guideline maximum, $6,280. The parties also stipulated that father's net monthly income was $5,549. Based on these figures and the agreed-on parenting plan, under which mother retained 36% of the parenting time and father's share increased to 64% of the time, the district court recalculated mother's net child support payment at $506 per month. The district court calculated mother's gross arrears as $17,710. But the district court credited mother for certain expenditures made pursuant to the original order, most significantly $7,431 for H.B.'s clothing expenses. After these adjustments, mother's net-arrearage obligation was reduced to $8,363.
Father moved to modify child support based on the adjustments of the maximum net-income guideline value and based on an alleged change in parenting time. Father also moved to delete the credit that the district court allowed mother for expenses paid pursuant to the initial order. The child support magistrate denied both motions, and the district court approved. This appeal follows.
DECISION I.
The first issue is whether the district court abused its discretion by declining to modify mother's child support obligation based on increases in the statutorily prescribed net-income limit. The district court has broad discretion to determine whether to modify child support. Gorz v. Gorz, 552 N.W.2d 566, 569 (Minn.App. 1996). Father brings his request for modification pursuant to Minn. Stat. § 518.64 (2004). The movant bears the burden of establishing a substantial change in circumstances sufficient to modify child support under that statute. Gorz, 552 N.W.2d at 569.
Minn. Stat. § 518.551 (2004) governed the determination of child support at the time the district court calculated child support on remand. Minnesota's statutory child support scheme was recently modified. See Minn. Stat. ch. 518A (2006). We apply the law in effect at the time that the district court considered father's motions. See McClelland v. McClelland, 393 N.W.2d 224, 226-27 (Minn.App. 1986) (identifying the general principle that a district court applies the law in effect at the time of its decision unless doing so alters a matured or unconditional right of a party or creates some other injustice), review denied (Minn. Nov. 17, 1986).
Subdivision 5(b) of Minn. Stat. § 518.551 established a grid, under which the presumptively appropriate child support obligation was calculated based on the obligor's net monthly income, but limited the amount of an obligor's net-monthly income that could be considered for child support purposes by establishing a net-income limit. Under this arrangement, the net-income limit was adjusted every other year "to reflect cost-of-living changes." Minn. Stat. § 518.551, subd. 5(k). The Minnesota Supreme Court was responsible for calculating, ordering, and making available the biannual change in the net-income limit. Id.
As relevant to this appeal, the monthly-income limits for application of the child-support guidelines were: $6,280 from July 1, 2000, to June 30, 2002; $6,751 from July 1, 2002, to June 30, 2004; and $6,975 from July 1, 2004, to June 30, 2006. Cost of Living Adjustments to Child Support Guidelines, C9-85-1134 (Minn. Apr. 19, 2000), C9-85-1134 (Minn. Mar. 18, 2002), C9-85-1134 (Minn. Mar. 11, 2004) (orders).
At the time of the dissolution trial in 2001, the district court found that mother's annual income was $147,500. This was apparently gross income. After our remand, the district court has calculated child support based on mother's previously stipulated net-monthly income of $6,280, the limit under the statute in 2001. Following that determination, father moved to modify child support pursuant to Minn. Stat. § 518.64 based on the increases in the statutorily prescribed net-income limit. The child support magistrate denied the motion and the district court approved the magistrate's recommendation. Father argues that the district court has abused its discretion.
Father did not claim that he was entitled to an adjustment in child support under Minn. Stat. § 518.641 (2004), the district court did not consider that section, and we do not address it.
Although there is a stipulation regarding mother's net income, the district court's order states: "For purposes of the remand, the parties stipulated that at the time of trial [mother] had net monthly income equal to or greater than the maximum amount of income considered for purposes of applying the child support guidelines in 2001 of $6,280." (Emphasis added.) Because the parties' net-income stipulation did not extend to mother's or father's income in 2002 and 2004, their incomes were not presumed to automatically increase. Father was required to support his motion with sufficient evidence of mother's net income in 2002 and 2004 to permit the district court to modify child support. But father does not claim and the record does not show that he supported his modification motion with evidence of mother's income in July 2002 and July 2004, when the net-income limits increased.
Father has the right to obtain evidence of mother's income through normal discovery means. See Minn. Stat. § 518.551, subds. 5b(a), (b). Father's 2003 modification motion indicates that he requested evidence of mother's income and that she failed to comply with the request. The record on appeal does not include any further information on that earlier request. Although father's February 2, 2005 affidavit requests the court to "require that both parties produce their income verification," the record does not include any indication that this statement was pursued.
Finally, the record does not indicate that father produced complete evidence of his own net income for the time periods for which he sought to increase mother's obligation. Father only submitted a 2002 income tax return showing an increase in his monthly income. Because the Hortis/ Valento formula requires offsetting the child support obligations of each party, accurate evidence of net income is needed from both parties. See Bender, 671 N.W.2d at 608. Mother's increased obligation is only part of the equation. Here, without evidence of father's current income, the district court could not have fairly recalculated father's new obligation or mother's net child support obligation.
Based on this record, we conclude that the district court did not abuse its discretion in declining to modify child support simply based on the increases in the net-income limit.
II.
Next, we consider whether the district court abused its discretion by denying father's motion to modify mother's child support obligation based on an alleged but never-formalized change in parenting time.
Minn. Stat. § 518.64, subd. 2 (2004), governed modification of child support orders at the time the child support magistrate considered father's modification motion. Under the statute, child support could be modified upon a showing of one of several circumstances, including a substantial change in a party's earnings or a substantial change in the need of a party or the child, either of which makes the terms of the effective child support order "unreasonable and unfair." Minn. Stat. § 518.64, subd. 2.
With both his 2003 and 2005 motions to modify child support, father included affidavits alleging that the parties' actual parenting time had shifted drastically from the percentages agreed on in the formal parenting plan. According to father, the original, agreed-on parenting time ratio — 64% with father and 36% with mother — was never implemented, and from September 1999 through April 2003, H.B. actually spent approximately 83% of his time with father and 17% of his time with mother. Further, father contends that from April 2003 to January 2005, H.B. spent 92% of his time with father and 8% with mother. To substantiate his claim, father submitted calendar pages from April 2003 to January 2005 recording the nights H.B. was with father.
Father also included letters from licensed psychologists. Although these letters document H.B.'s conflict with his mother and his reluctance to visit his mother when her new husband is in the home, the letters do not purport to indicate how the parties have actually shared parenting time. Finally, father offered a budget indicating that his actual monthly expenditures for H.B. were slightly higher than the amount budgeted for H.B.'s expenses in the original judgment.
The record does not establish that the district court abused its discretion by denying father's motion. Minn. Stat. § 518.64, subd. 2, does not provide for modification of child support based on an informal change in parenting time, standing alone. And appellant points us to no legal basis for that proposition. Rather, the statute establishes that to succeed in his modification motion, the movant must show one of several circumstances. Minn. Stat. § 518.64, subd. 2. As relevant to this appeal, father must show that expenses increased as a result of a change in circumstances. Here, even assuming father persuasively established a substantial change in parenting time, he offered minimal evidence establishing the increased financial needs resulting from that change. Elsewhere, the district court noted that the "court . . . previously found that it [could] not confidently rely on respondent to accurately report his expenditures." The order also states that "[t]he court continues to be concerned about the accuracy of respondent's claimed expenses without clear documentation." Ultimately, the district court reasoned that father did not meet his burden to show that modification of child support was warranted.
Based on the record in this case and our deference to the district court's credibility judgments, we conclude that the district court did not abuse its discretion by denying father's motion.
III.
The final issue is whether the district court abused its discretion by crediting mother's expenditures, made pursuant to the original child support order, against her total child support obligation. "District courts have broad discretion in determining child support." Strandberg v. Strandberg, 664 N.W.2d 887, 889 (Minn.App. 2003). In addition, this court's direction to the district court on remand was broad. We simply directed the district court to "calculate the parties' child-support obligations in accordance with the Hortis/ Valento formula." Bender, 671 N.W.2d at 608. We did not specify how the district court should account for prior child support payments made pursuant to the original order.
The district court explained its decision. It found that "prior to October of 2004, [mother] based her expenditures for the child in good faith reliance on the order under which she was not obligated to pay cash support to respondent." And the district court limited mother's claim for a clothing credit: "By reducing her claim by 30%, the court is giving some weight to [father's] arguments that [mother] may have purchased more expensive clothing than dictated by the family's historical lifestyle and to [father's] claims that he should be credited for some expenses he paid directly."
Father argues that the law explicitly prohibits crediting mother for clothing expenditures and cites Minn. Stat. § 518.68, subd. 2(4)(a), which provides: "Payment of support . . . is to be as ordered, and the giving of gifts or making purchases of food, clothing, and the like will not fulfill the obligation."
We agree that the statute's purpose is to prevent parties from substituting gifts, clothing, or other expenditures for their child support obligations. But here, the district court originally ordered mother to pay for H.B.'s clothing expenses and explicitly approved of payment for clothing expenses as part of mother's child support obligation. Her payment for H.B.'s clothing was not an attempt to evade her support obligation or an attempt to substitute payment for clothing for her monetary obligation. Because she did not know how this court would rule in the earlier appeal, and because it would have been against mother's financial self-interest to spend excessively, we cannot infer that she made lavish clothing purchases to game the earlier order. Moreover, to penalize her compliance with what was then an effective district court order would be a perverse result.
Because the district court is given broad discretion to calculate child support and because the district court did not violate this court's directive on remand, we conclude that the district court did not abuse its discretion in partially crediting mother's clothing expenditures toward her total child support obligation.
Because the district court did not abuse its discretion in denying father's motions, we affirm.
Affirmed.